property rights

Defending Nature via Property Rights

by Wayne Crews on April 17, 2011

in Environment, Features, Property Rights

Post image for Defending Nature via Property Rights

Elizabeth Brubaker describes why the institutions of private property are needed to defend nature, and why modern control policies that undermine them contribute to pollution and environmental destruction.

Our policy task today is to discover, legitimize and extend those private property institutions that can achieve and heighten environmental progress and expand environmental amenities. Today’s policies, in contrast, demean and abandon those essential institutions and traditions, and make enemies out of those who otherwise would be enlisted in the goals of ecological improvement. The entire book Property Rights in the Defence of Nature is available online.

Federal Government and State Attorneys General Push Arbitrary Mortgage Bailout

by Hans Bader on March 16, 2011

in Bailout Watch, Economy, Features, Legal, Property Rights

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Back before the election, intellectuals with ties to the Obama administration proposed a trillion-dollar bailout for some (but not all) underwater mortgage borrowers, as a way to increase consumer spending.

Last week, The Washington Post reported that bureaucrats at the newly-created Consumer Financial Protection Bureau (CFPB) want to do something similar on a smaller scale. Their proposal would require banks to write off part of the mortgages of certain (but not all) mortgage borrowers who owe more on their mortgage than their house is worth. Worse, they would require mortgage servicers to write off loan principal on loans owned by other institutions, like pension funds, violating their property rights.

Virtually all of America’s pension funds own mortgage-backed securities. Pension funds that millions of people rely on for their retirements would lose billions of dollars due to reduced mortgage value. These demands are contained in a 27-page proposed settlement sent to the banks by the CFPB, the Justice Department, and state attorneys general who sued the banks over their recent foreclosure documentation lapses. Such demands flout court rulings like Louisville Joint Stock Land Bank v. Radford (1935), which overturned a federal law that wiped out mortgage value.

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Dodd-Frank Financial “Reform” Violates Property Rights and Equal-Protection Guarantees

by Hans Bader on January 9, 2011 · 2 comments

in Bailout Watch, Economy, Legal, Property Rights, Regulation

Last week, I described how the Dodd-Frank financial “reform” law passed last summer violates constitutional separation-of-powers safeguards by giving unaccountable bureaucrats the power to seize companies and legislate through administrative fiat.  But that is not the only way Dodd-Frank violates the Constitution.  It also violates property rights and equal-protection guarantees.

For example, it contains racial preferences that were criticized by members of the U.S. Commission on Civil Rights. It “imposes race and gender employment quotas on the financial industry,” noted economist Diana Furchtgott-Roth in the Washington Examiner. Its ”Section 342 states that race and gender employment ratios must be observed by all government agencies that regulate the financial sector, as well as private financial institutions that do business with the government.”

This unconstitutional requirement is the brainchild of Los Angeles Congresswoman Maxine Waters, the Castro-loving, left-wing ideologue who earlier praised the Los Angeles race riots that destroyed scores of Korean-owned businesses as an “uprising” against injustice. Waters once told a CEO in a public Congressional hearing, “This liberal will be all about socializing . . . .uh, uh . . . would be about, basically, taking over and the government running all of your companies.”

Law Professor Richard Epstein notes that Dodd-Frank is also an unconstitutional “taking” of private property, since it deliberately forces certain banks to process debit card transactions at a loss. (That provision is being challenged in a lawsuit called TCF Bank v. Bernanke. Debit cards did not contribute to the financial crisis in any way, but Dodd-Frank regulates them at the behest of large businesses that objected to being charged any fee by banks for processing debit card payments. Thanks to Dodd-Frank, some customers will now be charged annual fees for their debit cards.)

Dodd-Frank itself contains little “reform,” reinforcing the very features of the status quo that spawned the financial crisis.  Congressional Democrats blocked a GOP amendment that would have reformed the government-sponsored mortgage giants, Fannie Mae and Freddie Mac, and the Obama administration lifted a $400 billion limit on bailing them out and showered their executives with $42 million in pay — even though Treasury Secretary Geithner has admitted that “Fannie and Freddie were a core part of what went wrong” in the financial crisis.

Fannie and Freddie helped spawn the mortgage crisis by buying up risky mortgages and repackaging them as prime mortgages, thus creating an artificial market for junk: “From the time Fannie and Freddie began buying risky loans as early as 1993, they routinely misrepresented the mortgages they were acquiring, reporting them as prime when they had characteristics that made them clearly subprime.”

At the direction of the Obama administration, Freddie Mac ran up more than $30 billion in losses to bail out mortgage borrowers, some of whom had high incomes. Federal regulators sought to make Freddie Mac hide the resulting losses from the SEC and the public.

Dodd-Frank is not unique in containing racial preferences. Many bills backed by Obama are riddled with racial set-asides, including the health care law passed last year. Obamacare has attracted criticism from the U.S. Commission on Civil Rights for containing both racial preferences and lower standards for treatment in predominantly-minority institutions, potentially harming both white applicants and minority patients. This racial discrimination appears to violate court rulings like the Supreme Court’s Adarand decision, and the Rothe and Western States Paving decisions issued by the federal appeals courts.

New Jersey Trying to Seize Unused Gift Card Balances

by Ryan Young on January 3, 2011

in Economy, Politics as Usual, Regulation

New Jersey residents with unused gift cards might want to make that trip to Target or Home Depot soon. The state legislature voted to seize the unused balances of all gift cards and traveler’s checks issued in the state before a certain date.

A judge struck down the law, but the state is appealing the ruling. By stealing the gift card balances from their owners, the state could raise up to $80 million.

That’s one way to fix a busted budget. Here’s another: spend less.

How Property Rights Saved the Pilgrims After the First Thanksgiving

by Hans Bader on November 24, 2010

in Deregulate to Stimulate, Economy, International, Politics as Usual, Property Rights, Zeitgeist

In Reason Magazine, Nick Gillespie and Meredith Bragg write about how the establishment of property rights among the pilgrims made them more “industrious” and banished the specter of “famine” that had killed many of the Pilgrims. We wrote earlier about how the communal economic system set up by the Pilgrims led to “chronic food shortages” even after the first Thanksgiving that led them to nearly “starve to death,” and how “little food was produced” until the Pilgrims changed their economic system to assign each family “a private parcel of land,” which led to vastly increased production of food.

In much of the world, property rights remain stunted. For example, in Ethiopia, peasants still cannot own land, although they can at least lease it unlike in the days of Communism (international aid has reinforced that country’s oppressive government and thus enabled it to avoid reforms like private landownership and privatization of state monopolies in its economy).

As Gillespie and Bragg note, on Thanksgiving we should “give thanks to the true patron of this holiday feast: property rights.”

U.S. Slips to Historic Low in Global Corruption Index

by Hans Bader on October 26, 2010

in Bailout Watch, Economy, Legal, Politics as Usual, Property Rights

America has slipped to a historic low in the global corruption index, Reuters reports, and it is no longer one of the 20 least corrupt countries.  The Bernard Madoff scandal, in which the SEC failed to do anything about the world’s largest Ponzi scheme despite multiple warnings, was cited as one of several factors by Transparency International.

The SEC was recently rewarded for its failure with a big budget increase and provisions in the 2010 Dodd-Frank financial “reform” law allowing it to withhold information previously available to the public under the Freedom of Information Act. Meanwhile, the Treasury Department recently paid a Democratic donor to advertise a position for a new bureaucrat with expertise in using technicalities “to withhold information from release to the public.” In the face of public outrage and ridicule from conservative lawmakers, Congress eventually repealed the information-withholding provision in Dodd-Frank, in open-government legislation sponsored by Rep. Darrell Issa (R-Calif.).

Earlier, the World Economic Forum noted that property rights are deteriorating in the United States, to the point where America now ranks behind third-world countries like Gambia and Jordan.  The U.S. ranks 40th in the world; last year, it ranked 30th.  Property rights have suffered under Obama.  The Obama administration ripped off bondholders in the government takeovers and bailouts of General Motors and Chrysler, harming pension funds, and non-union retirees.

America Declines in Property Rights, Rule of Law

by Hans Bader on September 9, 2010 · 1 comment

in Bailout Watch, Economy, International, Labor, Legal, Politics as Usual, Regulation, Zeitgeist

The World Economic Forum says that property rights are deteriorating in the United States, to the point where America ranks behind third-world countries like Gambia and Jordan.  The U.S. ranks 40th in the world; last year, it ranked 30th.

Contract and property rights have taken a beating from the Obama administration.  For example, it ripped off bondholders in the government takeovers and bailouts of General Motors and Chrysler, harming pension funds, non-union retirees and others.

Capitol Hill employees have run up record amounts of overdue and unpaid taxes — a 37 percent increase over 2007.  That’s true even as the Congress they work for has passed a multitude of new tax increases on investors, patients, manufacturers, and others.   And Treasury Secretary Geithner cheated on his taxes.

Meanwhile, a Virginia congressman admits, “If you don’t tie our hands, we’ll keep stealing.”

Five Years After Kelo

by Marc Scribner on June 23, 2010

in Economy, Legal, Personal Liberty

Today–this June 23–marks the fifth anniversary of the U.S. Supreme Court’s wrongheaded ruling in Kelo v. New London. Here’s my piece on Kelo+5 in The Daily Caller. The reasoning behind the opinion relied primarily on three past (although modern) Supreme Court decisions involving definitions of “public use”:

  1. Berman v. Parker (1954) — This case upheld the right of municipalities to declare entire areas blighted, even if the property in question isn’t blighted. It also accepted Washington, D.C.’s argument that the area condemnation was necessary to prevent future blight. An all around terrible decision.
  2. Hawaii Housing Authority v. Midkiff (1984) — This case involved redistribution of land titles in Hawaii. When the state moved to seize the properties, 49 percent of land in Hawaii was controlled by government and 47 percent was controlled by 72 owners. The Court failed to recognize the central problem with land distribution in Hawaii at the time: almost half of the property was controlled by government, which created massive real estate market distortions–in addition to Hawaii’s odd economic history. While Justice Sandra Day O’Connor wrote the majority opinion in Midkiff, she also wrote a scathing dissent in Kelo, where she regretted her broad language in the Midkiff ruling that opened the door for a terrible opinion like Kelo.
  3. Ruckelshaus v. Monsanto Co. (1984) — This case involved chemical industry trade secrets. While it was solely about intellectual property, the Court argued that this case was relevant because it dealt with public use in a purely economic context. The enormous distinctions between intellectual property and real property were lost on the majority in Kelo.

While the ruling itself was terrible, the events of New London demonstrate the fallibility of the municipal planner world view–that they somehow possess more market information than actual market players, and can in essence predict the future. In 2009 of last year, Pfizer announced it was closing the research facility that spawned New London’s redevelopment pipe dream, which in turn led the city to seize and demolish the petitioners’ homes. The land where their homes once stood is now largely vacant, with waist-high weeds supporting a thriving community of feral cats. Just another sad example of how economic development by fiat is bound to fail.

A salute to coal mining

by Fran Smith on April 8, 2010

in Energy, Natural Resources

In today’s Investor’s Business Daily, CEI’s Iain Murray tells about his first-hand experience with coal-mining and salutes the miners and the mine owners for the brave and necessary work that they do.  As Iain notes:

“Coal mining is a difficult job, just as it was in my grandfather’s time. The conditions are harsh and danger is ever present, which is why the wages for coal miners are often the best-paying jobs in many regions. Because of the remoteness of many mines, coal mining is central to most mining communities, rather than just one industry among many. Close the mines abruptly and those communities die.”

“Indeed, God bless the people of Montcoal, W.Va., and similar communities around the world. The perilous work they do underpins the work the rest of us do, and makes our nation richer, safer and freer. For that they should be remembered not as victims, but heroes.”

Read the whole article here.

Obama Nominates Left-Wing Extremist Goodwin Liu to Appeals Court; Liu is Possible Supreme Court Nominee

by Hans Bader on March 5, 2010

in Employment, Environment, Legal, Politics as Usual, Sanctimony

President Obama has nominated law professor Goodwin Liu, a left-wing extremist, to the nation’s largest federal appeals court, the Ninth Circuit.  Liu is hostile to “‘free enterprise, private ownership of property, and limited government.’ According to Liu, these are ‘code words for an ideological agenda hostile to environmental, workplace, and consumer protections.’”  Liu opposed the appointment of Supreme Court Chief Justice John Roberts, who was easily confirmed by the Senate in a bipartisan vote of 78-to-22, on the grounds that Roberts supported these “basic precepts of American liberty and economic freedom.”

Liu has been suggested by left-wing “civil-rights” groups as a possible Supreme Court nominee.

Liu also believes in “a constitutional right to welfare“  (perhaps echoing Obama, who has expressed regret that the Supreme Court “didn’t break free” from legal constraints in order to bring about “redistribution of wealth”).  Liu is also a big user of politically-correct psychobabble, writing that a judge is supposed to be a “culturally situated interpreter of social meaning” rather than an impartial umpire who interprets the law in accord with its plain meaning or its framers’ intent.

Bar association standards say lawyers are supposed to have practiced law for at least 12 years before being nominated to a judgeship, and also must have “substantial courtroom and trial experience.“  Liu has no trial experience, and has not even been out of law school for 12 years, meaning he is by definition unqualified under ABA standards.  But a liberal ABA committee, showing ideological bias, rubberstamped his nomination anyway, ignoring his lack of the required qualifications, since its members share his extreme political views.

Meanwhile, the Obama administration is doling out favors to politicians that violate federal influence-peddling statutes.  (Earlier, the Administration fired an inspector general, Gerald Walpin, who uncovered wrongdoing by an Obama crony.)

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